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2023 (1) TMI 853 - ITAT CUTTACKRevision u/s 263 by CIT - interest on the TDS was alleged to have not been disallowed - HELD THAT:- As it is noticed that the interest of the TDS has already been added back by the assessee in its computation of total income, the revision proceedings in respect of this issue stands quashed. Details of liability for expenses and the provision for salary had not been examined by the AO - As it is noticed that the said provision is not in respect of the salary but it is in respect of the income tax and it is carried forward from the earlier years, admittedly, this issue is not one which can fall within the purview of revision u/s.263 of the Act and consequently the revisionary proceedings on this issue stands quashed. Net profit from the business of the assessee appears to be low but was not examined by the AO - A perusal of the query raised by the AO in the course of original assessment clearly shows that he has looked into the purchases, sales and the expenses thereto. The same have not been disturbed except for an addition in respect of telephone expenses. Thus, once the expenses have been accepted and the purchases and sales figures have already been accepted, the result in net profit cannot be tinkered with. This being so, we are of the view that the issue has already been considered by the AO and the revisionary proceeding on this issue is unsubstantiated and consequently the same is quashed. Software expenses, whether was capital or revenue in nature, had not been examined by the AO - As it is noticed that the issue has already been considered by the AO in reply to the query No.12 and also as it is noticed that the expenses in relation to the renewal of the tally software license, the same is purely revenue in nature also. The figure is only Rs.23,750/- and not Rs.6,86,817/- as proposed by the ld. Pr.CIT. Consequently, the revisionary proceeding on this issue stands quashed. Puja expenses did not relate to business of the assessee and the same need to be disallowed - The facts in the present case clearly show that the issue was part of the reply to the query No.12 raised by the AO in the course of original assessment. When the said query has been addressed and answered, it is to be presumed that this issue has also been looked into by the AO in the course of assessment. Just because there is no specific finding of the AO in respect of each of the issues, does not mean that the issue has not been examined by the AO. In fact the disallowance under the head telephone & Internet charges, are the expenses under selling, distribution and administration overheads. Thus, it must be presumed that the AO has examined each of the expenses mentioned therein. This being so, we are of the view that the revision proceedings on this issue is unsubstantiated and consequently the same is quashed. Propriety of the claim of interest under the house property had not been examined by the AO - A perusal of the facts of the present case clearly shows that this amount has been specifically shown in the computation of the total income and is also supported by the return of income filed by the assessee. Admittedly this issue has not been examined by the AO nor any specific query has been raised by the AO in the assessment proceedings. This being so, we are of the view that the ld. Pr.CIT is right in invoking his powers u/s.263 of the Act on this issue. Consequently, the revisionary proceeding on this issue stands upheld. Nature of the business of the partnership firm and the relation to the assessee’s business had not been examined by the AO - It is noticed that when passing the assessment order u/s.143(3) of the Act, the AO has adopted the total income as per the return of income. This is supported by the computation of total income wherein the interest on the capital, remuneration from the firm and profit of the firm in respect of the two partnership firm are also included. This being so, we are of the view that this issue has also been considered by the AO and the revisionary proceeding on this issue is unsubstantiated and consequently, the same stands quashed. Here we may also mention that though the ld. Pr.CIT mentions that no reply has been filed by the assessee, the facts evident that replies have been filed to the shows cause notice. Though clearly on this ground itself the revisionary proceedings would have been quashed, still as we noticed that one of the issues have not been examined by the AO, the revisionary proceedings is to be upheld only to in respect of that single issue being the propriety of the claim of the interest under house property not examined by the AO. Appeal of the assessee stands partly allowed.
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